Steel industryMarket Changes and Development Trends

Faced with multiple challenges under weak recovery, the risk of recession in major global economies has increased in 2023, and the world economy is gradually cooling down and entering a "shallow recession" range. Our country's economy has entered a phase of deceleration and quality improvement, and is at a critical period of accelerated structural transformation of both international and domestic economic momentum. The main expected target for national economic development in 2023 is a growth of about 5% in gross domestic product.
Under the macroeconomic situation both domestically and internationally, analyzing the supply side of the steel industry market, China's steel production increased year-on-year from January to July 2023, with a significant increase in steel exports and a significant decrease in imports, resulting in a significant decline in industry operating efficiency. From the demand side analysis, the demand for steel in China's steel market in 2023 shows three major trends: a decline in real estate demand, a significant increase in new demand, and an upgrading of traditional demand. It is expected that the annual steel demand will slightly decrease year-on-year, and it is expected that the steel demand will show a fluctuating downward trend during the 14th Five Year Plan period. With the steady increase in demand for high-quality steel, it will drive high value-added steel varieties to maintain a high prosperity and upward development trend.
Faced with the challenge of slow demand recovery and fast supply rebound, China's steel industry should control its pace in the short term. To strengthen industry self-discipline and actively control production pace; Strengthen differentiated policies, make good use of control policies such as crude steel production, environmental protection and production restrictions, and differentiated electricity prices; Strengthen ultra-low emission transformation and increase the proportion of production restrictions for enterprises that do not meet the standards; Strengthen energy consumption dual control constraints, increase energy conservation supervision efforts, and strictly investigate enterprises that do not meet energy consumption standards. Mid term structural adjustments should be made. To promote the diversified development of industrial structure, rational development of layout structure, coordinated development of product structure, and coordinated development of energy structure. Long term adaptation pattern. The entire industry will build four new patterns of "three parts of the world": the enterprise pattern will form a "three parts of the world" for leading enterprises, professional enterprises, and homogeneous enterprises; the process pattern will form a "three parts of the world" for growth processes, short processes, and low-carbon processes; the energy pattern will form a "three parts of the world" for primary energy, secondary energy, and new energy; and the raw material pattern will form a "three parts of the world" for domestic resources, foreign resources, and recycled steel.